NRV Residential Trends: Mar 2023 to Mar 2024
The NRV housing market showed mixed signals in March 2024, with increased buyer activity but ongoing affordability challenges. New listings rose by 16.1% year-over-year, meaning more homes were put on the market compared to last March. This helped ease inventory constraints slightly, as the total number of homes for sale increased by 3.7%. However, despite the additional supply, closed sales dropped by 6.4%, indicating that not all listed homes were finding buyers.
On the other hand, pending sales surged 30.7%, suggesting that buyers are still active and many homes are under contract but haven’t yet closed. This could be a sign that the market is heating up for the spring season, but it also means that some deals may take longer to finalize.
Homes are staying on the market longer, with the average days on market increasing by 25% to 50 days compared to last year. This suggests that while buyers are making offers, they may be taking more time to negotiate, or sellers are holding out for better deals. Despite this longer selling period, home prices continue to rise, with the median sales price climbing 12.5% to $269,750 and the average sales price increasing 12.1% to $327,161. This price growth reflects ongoing demand but also highlights a growing affordability issue.
Speaking of affordability, the Housing Affordability Index fell sharply by 18%, meaning that the typical buyer is finding it increasingly difficult to afford a home at current price levels. Mortgage rates and rising prices are both contributing to this decline, putting pressure on first-time buyers and those with tighter budgets.
The months’ supply of inventory increased by 8%, now sitting at 2.7 months’ worth of homes, which means that even though more listings are available, they’re not selling as quickly as before. This could indicate a slight shift toward a more balanced market, though sellers still hold some advantage, as homes are selling close to their asking prices with 97.6% of list price received on average.
In summary, I'd say buyer activity is strong, as pending sales jumped, but closed sales fell, meaning not all deals are making it to the finish line. Homes are sitting longer on the market, but prices continue to rise, making affordability a growing challenge. Inventory is improving slightly, but supply remains tight, keeping sellers in a strong position. Affordability is declining due to rising prices and mortgage costs, putting pressure on buyers.